Zipcar Case Study

This case briefly introduced a car rental company-Zipcar and its new business strategy. Furthermore, the case also introduced what are the advantages of Zipcar, compared with other traditional rental company. The issues related to the Chapter 2 that I founded in this case are: 1) The Information System is aligned with both organization strategy and business strategy. 2) Porter model, overall cost leadership and differentiation strategy. 3) Applications of Social IT.

Discussion

1. Few threats of new entrants: Zipcar’s business model embraces IT as its core, which is difficult to copy. And the model assists Zipcar very unique in car rental market. Low bargaining power of suppliers due to the operation of Zipcar base on IT, it cost low labor and office place. Furthermore, the parking area is flexible and low cost. Low bargaining power of buyers, as mentioned in the case, Zipcar focus on the people who want to rent a car for a few hours in their home city, which means a large target market. In addition, the convenient experience of car rental and the online community are the advantages of Zipcar. There are several threats of substitute products, such as the bus and the metro if the customers require transport in pretty big city, and the railway connected two cities. Rivalry among existing competitors is low, due to the Zipcar is more convenient and cheaper, compared to other companies. And its online community is unique to collect the feedback.

2. IT plays an important role in the operation of Zipcar. And the business strategy based on the IT, such as online reservation and the GPS locating. In addition, it reduces the requirement of human resource and impacts the organization strategy.

3. Yes. The online community affects the business strategy by provide the channel to collect the feedback, and share the positive experience to new customer.

4. As a CEO of Zipcar, I think the substitute product will be